Proposal to Increase VAT on Unhealthy Food to 21% for Health Benefits

• Fiscalist Fons Overwater suggests setting a 0% VAT rate for products in the “Schijf van Vijf” and a 21% rate for unhealthy food
• He believes this would lead to significant health benefits and cost the government nothing
• Overwater predicts a 10-33% increase in sales of healthy food due to the price difference
• The VAT reduction to 0% would cost the government €2.05 billion, while the increase to 21% for unhealthy food would generate €2.75 billion in extra revenue
• Overwater proposes using the temporary surplus of €0.7 billion to support low-income individuals in transitioning to healthier eating
• Previous calls to lower VAT on fruits and vegetables have been met with skepticism from researchers and the Central Planning Bureau
• Overwater hopes to gain majority support in the Tweede Kamer for his proposal.

Source: taxlive.nl

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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